An Open Letter from Economists in Support of Financial Transaction Taxes

A modest set of financial transaction taxes could raise a substantial amount of needed revenue while having little impact on trades that have a positive economic impact.

The cost of trading financial assets has plummeted over the last three decades as a result of computerization. This has led to an enormous explosion in trading volume, with most trades having little economic or social value and redistributing disproportionate resources to the financial sector. A set of modest financial transactions taxes, which would just raise trading costs back to the level of two or three decades ago, would have very limited impact on trades that have real economic value.

Such taxes could both reduce the volume of speculation in financial markets and provide substantial revenue for either important public purposes and/or deficit reduction. Financial transactions taxes could be an important part of a reform package that seeks to remake the financial sector so that it better serves the larger economy.

DISTRICT OF COLUMBIA Dean Baker, Center for Economic and Policy Research Josh Bivens, Economic Policy Institute Jeff Faux, Economic Policy Institute Maria Floro, American University Caren Grown, American University Helene Jorgensen, Center for Economic and Policy Research William Kandel, Economic Research Service, USDA Hank Leland, Service Employees International Union Lawrence Mishel, Economic Policy Institute David Rosnick, Center for Economic and Policy Research John Schmitt, Center for Economic and Policy Research Heidi Shierholz, Economic Policy Institute Howard Wial, The Brookings Institution John Willoughby, American University Sheila Zedlewski, Income & Benefits Policy Center

FLORIDA Charles Rock, Rollins College

GEORGIA Tanweer Akram

ILLINOIS Ron Baiman, Center for Tax and Budget Accountability William Barclay, Chicago Political Economy Group Marianne Ferber, University of Illinois, Urbana-Champaign Paul Lockrd, Black Hawk College Joseph Persky, University of Illinois at Chicago Samuel Rosenberg, Roosevelt University

MARYLAND Gar Alperovitz, University of Maryland Barbara Bergmann, University of Maryland Jon Goldstein, GTBEconomics Robert Lynch, Washington College

MASSACHUSETTS Randy Albelda, University of Massachusetts, Boston Michael Ash, University of Massachusetts James Boyce, University of Massachusetts, Amherst Robert Buchele, Smith College Jim Campen, Americans for Fairness in Lending Jens Christiansen, Mount Holyoke College Anita Dancs, Western New England College Noah Enelow, Hampshire College Gerald Epstein, University of Massachusetts, Amherst Gerald Friedman, University of Massachusetts, Amherst Carol E. Heim, University of Massachusetts, Amherst James Heintz, University of Massachusetts Adam Hersh, University of Massachusetts Arjun Jayadev, University of Massachusetts, Boston J. K. Kapler, University of Massachusetts, Boston Catherine Lynde, University of Massachusetts, Boston Arthur MacEwan, University of Massachusetts, Boston Julie Mattahei, Wellesley College Kevin M McCarron Michael Meeropol, Western New England College Julie Nelson, University of Massachusetts, Boston Laurie Nisonoff, Hampshire College Mary Orisich, Holyoke Community College Karl Petrick, Western New England College Martin Rapetti, University of Massachusetts Joseph Ricciardi, Babson College Helen Scharber, University of Massachusetts Peter Skott, University of Massachusetts Peter Spiegler, University of Massachusetts, Boston David Terkla, University of Massachusetts, Boston Jeannette Wicks-Lim, University of Massachusetts, Amherst Ben Zipperer, University of Massachusetts, Amherst

MICHIGAN David Arsen, Michigan State University Jean Kimmel, Western Michigan University Margaret Levenstein, University of Michigan Hannah McKinney, Kalamazoo College Kevin Murphy, Oakland University Frank Thompson, University of Michigan John Tower, Oakland University (Retired) Thomas Weisskopf, University of Michigan

MINNESOTA Cyrus Bina, University of Minnesota Ann Markusen, University of Minnesota

NEW JERSEY Eileen Appelbaum, Rutgers University Douglas Kruse, Rutgers University Michele Naples, The College of New Jersey Cordelia Reimers, Hunter College, City University of New York Bernard Smith, Drew University Paula Voos, Rutgers University

NEW YORK Marcellus Andrews, Barnard College/Columbia University Nesecan Balkan, Hamilton College Lourdes Beneria, Cornell University Howard Botwinick, SUNY Cortland Howard Chernick, Hunter College, City University of New York Kimberly Christensen, SUNY/Purchase College Susan Davis, United University Professions Gregory DeFreitas, Hofstra University Chris Georges, Hamilton College Teresa Ghilarducci, The New School Robert Guttmann, Hofstra University Conrad Herold, Hofstra University Leo Hindery, InterMedia Partners David Howell, The New School Douglas Koritz, Buffalo State College Brent Kramer, City University of New York Henry Levin, Columbia University Thomas Masterson, Levy Economics Institute of Bard College Martin Melkonian, Hofstra University Tom Michl, Colgate University Basilio Monteiro, St. John’s University Jamee Moudud, Sarah Lawrence College Pierre Ostiguy, Bard College Aaron Pacitti, Siena College James Parrott, Fiscal Policy Institute Michael Pendleton, Buffalo State College Marilyn Power, Sarah Lawrence College John Roche, St John Fisher College Frank Roosevelt, Sarah Lawrence College John Sarich, Cooper Union Ted Schmidt, SUNY College Buffalo Sumitra Shah, St. John’s University Richard Shirey, Siena College Dale Tussing, Syracuse University Lucy Law Webster, Economists for Peace and Security David Weiman, Barnard College June Zaccone, Hofstra University

NORTH CAROLINA Stephen Holland, University of North Carolina at Greensboro Victor Schoenbach, University of North Carolina at Chapel Hill

OHIO Rudy Fichtenbaum, Wright State University Susan Helper, Case Western Reserve University Paulette Olson, Wright State University Jeffrey Stewart, University of Cincinnati

OREGON John Gallup, Portland State University John Hall, Portland State University Mary King, Portland State University Leopoldo Rodriguez, Portland State University Mark Thoma, University of Oregon John Walker, Portland State University

UTAH Jean Arment, University of Utah Gunseli Berik, University of Utah Gail Blattenberger, University of Utah Al Campbell, University of Utah Nathaniel Cline, University of Utah Brian England, University of Utah Peter Philips, University of Utah Matias Vernengo, University of Utah Adam Vester, University of Utah

VERMONT Peter Hans Matthews, Middlebury College Elaine McCrate, University of Vermont Stephanie Seguino, University of Vermont Jim Tober, Marlboro College

WASHINGTON Peter Dorman, Evergreen State College Timothy Payne, Shoreline Community College Diana Pearce, University of Washington Robert Plotnick, University of Washington Marjolein van der Veen, Bellevue College

WISCONSIN James Carpenter, Milwaukee Area Technical College Martin David, University of Wisconsin-Madison (Emeritus) Cheryl Maranto, Marquette University Marcelo Milan, University of Wisconsin-Parkside Michael Rosen, Milwaukee Area Technical College Matt Vidal, University of Wisconsin-Madison Don Weimer, Milwaukee Area Technical College

Monthly Review Essays

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